Its too much to ask but how about reinstituting the Fed's focus on fight inflation, preserving the value of the dollar and slowing down the growth in the money supply to equal that of the long term real rate of growth in the economy? So Ben, here is some advice: Let them fail! This is America not the old Soviet Union. This is capitalism. The markets are sending you a message that you are ignoring. In so doing, you are help turning the greatest economy in the world into a banana republic. The problem with living in DC is that it inflates your ego and makes you feel self important. I have always advocated moving the Fed to Kansas City in order to get away from DC and putting it in touch with real people. We saw that forbearance only upped the price of the S&L failures in the 1980s. This propping up of failures is the new forbearance. The Fed buys assets, holds them and hopes that the markets recover and increases their value. Maybe this will happen but in the interim we are rewarding bad behavior. Ben, have you ever heard of moral hazard?
Bank Reserves: A Hot Potato
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